Scotiabank drops Contact Photography Festival partnership in another revenue blow to struggling art events

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The Bank of Nova Scotia will drop its title sponsorship of Toronto’s Contact Photography Festival after this year’s edition, forcing organizers to search for new flagship funders as they gear up for the May event.

Contact has grown since 1997 to become one of the world’s largest photography festivals, attracting as many as 1.5 million people a year in venues and public places across Canada’s most populous city. Scotiabank has funded much of its budget since 2010, when it became the title sponsor after a few years of less intensive involvement.

While title sponsorships usually have a finite shelf life, Contact is emerging into a much different corporate-funding world than when Scotiabank first signed on. Despite nearly 18 months’ notice and help from the bank to find replacement sponsors, chief executive Darcy Killeen says the festival has only found two smaller-scale donors to step up in its stead. “I don’t see us getting a title sponsor now,” Killeen says. “I see us getting a series of large, national brands to work together.”

Contact’s annual revenues have recently been in the $1.3-million range, according to federal filings, except for a drop during the first year of the pandemic. Scotiabank has historically funded between a third and half that, Killeen says – but the new donors only represent about a tenth of the bank’s commitment. Finding a full replacement “is proving to be very difficult,” Killeen says. “That could have implications in the future for our ability to continue to curate at the level that we do.” (Some of Contact’s government funding is designed to match other revenue streams, Killeen added, threatening to lower the festival’s income further without a replacement.)

Though companies are still interested in arts and culture, some leaders in the sponsorship sector say that throwing a company’s name onto major festivals’ titles appears to have become less lucrative over the past decade. Potential sponsors are paying more attention to social causes they believe will boost their brand, while the well-heeled world of pro sports offers more eyeballs and data to prove returns on investment.

The consequences of this shift can be immediate. To save costs this year, Contact declined to print a festival catalogue and significantly reduced its advertising efforts. Though Killeen says the festival has not had to compromise on programming or the services it provides artists this year, he’s worried about making tough calls for future editions.

Contact revealed its struggles in replacing Scotiabank just six months after the telecom giant Bell dropped its 28-year title sponsorship of the Toronto International Film Festival. Last August, Bell said that it had exited its TIFF partnership “in order to invest in other opportunities that are core to our business.”

And at Scotiabank, “our sponsorships are strategic decisions made over time to align with business priorities,” chief marketing officer Laura Curtis Ferrera wrote in an e-mail. (The bank continues to sponsor the Scotiabank Giller Prize for fiction and is a presenting sponsor of the Hot Docs film festival, which itself recently revealed financial struggles.)

The end of Scotiabank’s title sponsorship for Contact comes in a post-COVID-lockdown era in which costs are soaring and culture-goers’ habits have changed. Many small and medium-sized theatre companies across the country are struggling to stay alive. Just last week, the Shaw Festival announced the biggest deficit in its history, while Just for Laughs cancelled this year’s Montreal comedy festival as it sought creditor protection.

Facing reduced audience revenue and often-stagnant government funding, many arts organizations have come to depend on philanthropy and corporate sponsors. But the gradual shift in sponsors’ attitudes in recent years means that finding a single title sponsor may no longer be a panacea to financial issues.

“The shift in arts sponsorship in itself is not a crisis – but coupled with the other trends that we’re seeing, it does create a very challenging environment for arts organizations,” says Aubrey Reeves, chief executive of Business / Arts, a Canadian charity that works to bridge those two worlds.

The sponsorship world is one of constant change. Going back to the 1980s and early nineties, it was common for major arts sponsorships to originate from boards and C-suites. Over time, however, major sponsorships increasingly became the responsibility of marketing departments that were more interested in direct measurements of return on investment, especially as consumer-behaviour tracking data became more granular in the digital age.

“I’m seeing an overall trend that is very slow: that brands perceive arts and culture properties, in general terms, more philanthropically,” says James O’Connor, a former professional dancer with the National Ballet of Canada who’s now vice-president with A&C Canada, a partnership agency that has worked with Contact in the past.

A major shakeup in how Canadian companies spread their sponsorship dollars began about a decade ago, according to the Canadian Sponsorship Landscape Study. Norm O’Reilly, a long-time sponsorship scholar who has run the study for nearly 20 years, says there was a “renaissance” in sports funding starting around 2013, which led to its piece of the pie nearly doubling to 45 per cent in 2022.

At the same time, brands kept sponsoring arts organizations in part because they “expected arts partners to have a ‘cause’ associated with them,” O’Reilly says. The study, he noted, was anonymous and voluntary in the corporate world – and thus not exhaustive – but it did have participation from the financial services and communications sectors.

The pandemic-era corporate refocusing on social justice issues, including the resurgence of the Black Lives Matter movement, appears to have prompted sponsors to focus more dollars directly on “cause”-related partnership rights, O’Reilly says. The study found that while arts sponsorships have grown slightly since 2019, accounting for 3.9 per cent of spending then and 7.9 per cent in 2022, cause-related sponsorships surged from 5.6 per cent to 19.4 per cent. (While arts sponsorship has grown in aggregate, O’Reilly says the dollars could be spreading across more organizations, particularly to those that have a connection to social causes.)

Scotiabank’s attention has been pulled both toward sport and social causes. Curtis Ferrera highlighted the bank’s ScotiaRISE program – a $500-million, 10-year effort focused on programs that give more people a better chance at climbing the economic ladder. And in 2017, Scotiabank won the naming rights to Toronto’s largest arena, the former Air Canada Centre, in a deal The Globe reported to be worth $800-million over 20 years.

Toronto’s multidisciplinary Luminato Festival lost its long-time exclusive presenting partner L’Oréal several years ago, and has since focused on highlighting individual events and other programming within the festival for companies to sponsor.

“We find special alignments where distinct elements of the program work with their target audiences,” says Jessica Litwin, the festival’s chief development officer. “I want them to feel that return on investment; it’s much easier to make it feel mutually beneficial.”

With a report from Barry Hertz.

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